Speedy defence acquisitions, finally

Defence equipment acquisitions in India are notoriously controversial. A slothful procurement system and routine allegations of bribery have marred the process for long.
Defence equipment acquisitions in India are notoriously controversial. A slothful procurement system and routine allegations of bribery have marred the process for long. Long-term issues of defence planning such as the level of indigenization the country can support and the mix of foreign and domestic equipment needed are often lost sight of or are politicized.

At least on one front change is visible: speed of acquisitions has increased visibly since the Narendra Modigovernment took charge in May.

Last week, the Defence Acquisition Council (DAC) cleared purchases worth Rs.80,000 crore. Perhaps the most critical order in this huge shopping bag is that of six submarines worth Rs.50,000 crore. Indiaâ€™s submarine strength has gone down perilously after successive accidents. In addition, the DAC also gave a green signal to the purchase of 8,356 Spike anti-tank guided missiles and 321 launchers from Israel. India chose to buy the Israeli missile over the US manufactured Javelin system.

All this comes over the DACâ€™s last big order in late August when it ordered 22 AH-64D Apache attack helicopters and 15 twin engine CH-47 Chinook helicopters. While the full list of equipment ordered by the DAC in its 29 August and 25 October meetings is not available, some conclusions can be drawn from the list. One, India still has to rely on imports for major equipment.

From attack helicopters to heavy lift choppers to sonar equipment for warships to multi-role helicopters for the navy, all have to be imported. Two, even after decades, India keeps on oscillating between extreme positions on whether it wants to build a military industrial manufacturing base for equipment such as submarines and helicopters. It is the latter point that is the weak policy link in Indiaâ€™s defence armour. Every government comes to power backing indigenization.

The last government had the same idea and its policy of offsets was supposed to be a stealth route to indigenization. Offsets literally mean locally sourcing components for equipment being purchased from a foreign manufacturer. By the end of the United Progressive Alliance (UPA) governmentâ€™s tenure, the offsets policy had become incoherent with no clarity on exceptions to offsets. One reason for this vexing state of affairs is institutional politics.

India has a large base of domestic defence manufacturers. Hindustan Aeronautics Ltd, various shipyards and now, increasingly, private sector companies have acquired the know-how to build some equipment. But this capability is not sufficient to inspire the confidence of the end users, the armed forces in many cases. The armed forces want equipment ready to use and do not want to be involved in the tedious process of trying equipment that they have little confidence in.

Governments have different ideas. Institutional pressures from public sector units and the defence bureaucracy often results in preference being given to local manufacturers against the wishes of the armed forces. Over and above these complicated political and institutional issues is the corrupting presence of lobbyists for foreign manufacturers who manage to have their say in defence acquisitions.

They make use of the existing frictions within the system to push their wares. At the moment, the Modi government is on a high. Make in Indiaâ€”the plan to turn India into a manufacturing hubâ€”is high on the governmentâ€™s priority list. Perhaps the push for indigenous manufacturing of critical pieces such as submarines and light helicopters is part of this push. This is fine and building domestic capabilities in a strategically important sector may not be a bad idea.

For India to take off on this path, sustained political attention to manufacturing, pushing for cooperation between different users and institutions and, most importantly, building design and development capability for critical equipment is essential. In the past after taking initial steps, such plans have faltered badly leaving everyoneâ€”armed forces especiallyâ€”scrambling for emergency purchases. The perilously low reserves of key equipmentâ€”submarines and light helicopters to ferry soldiers to very high altitudesâ€”highlights this. India cannot afford it.

Offsets are different from TOT. The western manufacturers are NOT keen on TOT. They agree to offsets only. Offsets develop only a partial capability, not full capability. However we have to accept this situation if we need to import Western arms.